Mr Price reports record market share growth after strong retail sales
JOHANNESBURG - MR PRICE posted strong retail sales and reported its biggest market share growth on record during the half year ended December 2020, despite the retail industry reeling from the impact of the Covid-19 restrictions.
The group said on Friday that retail sales during the 26 weeks ended December had jumped by 5 percent to R7.8 billion and total sales were 5.8 percent higher at R7.5bn, while other income decreased 16 percent to R253million.
Mr Price, whose divisions include Mr Price Home, Mr Price Sport, Miladys and Sheet Street, said retail sales at its South African stores had jumped by 5.4 percent to R6.9bn and store sales rose by 4.6 percent.
The consumer shift to digital shopping resulted in the online channel increase by a whopping 66.3 percent up from the 17.4 percent increase over the corresponding period.
Highlights included the 230 basis points growth in market share in October and November, marking the highest on record since the reinstatement of the Retailers’ Liaison Committee back data to January 2017, with gains consecutively for the past six months.
Mr Price also recorded a 5.9 percent growth in combined retail sales in October and November. The group’s October retail sales grew double digits, which continued into the first two weeks of November 2020.
“Economic assistance provided by the government and private sector from the start of the Covid-19 pandemic created temporary financial relief for households and supported consumer spending. Many of these support programmes fell away at the end of October 2020 with the effect being felt in the latter half of November 2020,” said Mr Price.
Despite muted sales during the Black Friday trading period, Mr Price said during the Black Friday week all its divisions gained market share and the group grew online sales 81.1 percent.
Black Friday, which is traditionally a drawcard for bargain-hunting consumers was, however, muted with BankServe data reporting store card transactions declining 32.6 percent in volume and 51.5 percent in value as Covid-19 compliance requirements constrained store capacity.
The group said cash was king and remained the preferred tender type of customers and credit sales decreased 7.6 percent as the group continued with its conservative approach to credit granting. Lay-bys were also gaining popularity as an alternative to credit sales, among the group’s customers.
Mr Price said its private label product assortment and value price points supported cash sales growth of 8.2 percent, constituting 86.8 percent of sales from 84.9 percent of total sales a year earlier. Sales in the home segment were up by 10.6 percent, driven by customer demand for household merchandise remaining high as many employers encourage work from home practices.
“The group anticipates the home trend to continue to grow strongly,” said Mr Price.
Sales in the cellular handsets and accessories division grew 22 percent over the period.
The share price on Friday rose 1.48 percent to R169.19.